Category: Economy

With the election over, it’s time to move on to new things, and the folks at the Campaign for America’s Future have asked me to do some writing about Social Security, which sounds like some big fun, so here we are.

We’re going to start with some reasonably simple stuff today, just to get your feet wet; by the time we get a few stories down the road there will be some complicated economic analysis to work through-but let’s begin today by looking a bit south.

Those who support privatizing Social Security in this country often point to Chile as an example we could follow, and that seems like a good place to get the conversation going…so set your personal WayBack Machine to Santiago, May, 1981, and let’s see what we can learn.

  The unemployment rate in Indiana is 9.9%, more than 4% less than states such as Nevada. Yet Indiana can see trouble coming in the form of desperate people.

 Armed security guards will be on hand at 36 unemployment offices around Indiana in what state officials said is a step to improve safety and make branch security more consistent…

  Lotter said the agency is merely being cautious with the approach of an early-December deadline when thousands of Indiana residents could see their unemployment benefits end after exhausting the maximum 99 weeks provided through multiple federal extension periods.

  “Given the upcoming expiration of the federal extensions and the increased stress on some of the unemployed, we thought added security would provide an extra level of protection for our employees and clients,” he said.

Desperate people do desperate things. What would you do if you couldn’t afford to put a roof over the heads of your family? What would you do if you couldn’t afford to feed yourself?

The story isn’t 100% accurate because starting December people who have collected just 26 weeks of unemployment can become a “99er”.

Crossposted at Daily Kos and The Stars Hollow Gazette

  Republicans have made themselves clear: no compromises.

  The GOP has plans that include cutting taxes while stimulating the economy.

 At least that is what they intend to do as long as reality doesn’t get in their way. Let’s face it: reality has not been a problem for the lion’s share of the Republican base. In their minds Obama is a muslim, and a socialist, who wasn’t born in America. And that’s just for starters, facts be damned.

 The thing is that most of America isn’t part of the Republican base. Most of America still lives in the real world. When things get tough that percentage is likely to grow because reality gets harder to ignore.

  That’s bad news for Republicans. There are several events building that are going to rain on their victory parade.

Laura Flanders of GRITtv talks with political economist Professsor Richard Wolff about economic collapse, austerity programs, and the recent and growing anger and popular uprisings and street actions in Europe that we may soon be seeing spreading to North America:

“It’s a bizarre idea to fix a global capitalist crisis by breaking a long-term promise,” notes Richard Wolff, economist and author of Capitalism Hits the Fan of the “austerity” measures rocking Europe’s social democracies at the moment. Governments across Europe are implementing drastic cuts to social safety nets, raising retirement ages, all in the name of fiscal responsibility, and people have taken to the streets–in France, between 1.3 and 2.9 million people have come out in protest, a percentage that Wolff notes would be equivalent to between 6.5 and 14.4 million [in the U.S.].

So what’s going on in Europe, and what are the lessons we can learn from the European left? Wolff joins us along with Inez McCormack, Chair of the Participation and the Practice of Rights Project in Ireland, to talk us through the crisis, the lessons, and the ongoing struggle.

Austerity Fatigue and Action in Europe – GRITtv – October 29, 2010

This past Wednesday “Barack Obama was a guest on The Daily Show, thereby becoming the first sitting president to appear as Jon Stewart’s guest. (In July, Obama became the first sitting president ever to appear on The View.) In the half-hour-long interview, Stewart quizzed his grizzled guest about health-care reform, the financial crisis, and the midterm elections.”

“Stewart’s most combative query concerned National Economic Council director Larry Summers-in particular, Obama’s hiring thereof. ‘We can’t expect different results with the same people,’ Stewart said, referring to Summers’s previous stint as treasury secretary under Bill Clinton. He continued, ‘Larry Summers … that seems like the exact same person.’ Obama, inadvertently quoting his imminently quotable predecessor, replied, ‘Larry Summers did a heckuva job.’ Stewart, somewhat shocked, advised him, ‘You don’t wanna use that phrase…'”

This morning at GRITtv Laura Flanders talked with journalist and Truthdig Editor-in-Chief Robert Scheer, who reminds that “Summers was the chief architect of Clinton-era policies that created the economic crisis in the first place, and that Obama’s appointment of him to get us out of it was never going to result in anything but more money being thrown at Wall Street.”

It’s no wonder that there is now so much irrepressible enthusiasm among the liberals and independents and progressives who tipped the balance in the democrats favor in 2006 and in 2008 to get out and vote for democrats in the 2010 midterm elections.

  Rep. Damon Silvers, a member of the independent Congressional Oversight Panel, asked what is probably the most important question facing America today.

 We can either have a rational resolution to the foreclosure crisis or we can preserve the capital structure of the banks. We can’t do both.

 Which should we do?

 The question doesn’t sound all that ominous, but it is. In essence we must chose between protecting the TooBigToFail Wall Street banks, or the rule of law.

 That may sound overly dramatic, and I wouldn’t blame you if that was your initial reaction, but surprisingly the choice really is that simple.

  Eighteen months ago William Black was interviewed by Bill Moyers on PBS. The subject of the interview was fraud.

WILLIAM K. BLACK – when we look at these liar’s loans, we find 90 percent fraud. 90 percent. And we find that most of the frauds are not induced by the borrower, but they’re overwhelmingly done by the loan brokers.

…

No real questions asked. Certainly no answers checked. In fact, we just had hearings last week about WaMu, which is also a huge player in these frauds. Washington Mutual, which used to make, run all those ads making fun of bankers who, because they were stuffy and looked at loan quality before they made a loan. Well, WaMu didn’t do any of that stuff. And of course, WaMu had just massive failures. And who got in trouble at WaMu? Who got in trouble at Lehman? You got in trouble if you told the truth. They fired the people who found the problems. They promoted the people that caused the problem, and they gave them massive bonuses.

 It wasn’t just low-level employees. Matthew Lee, vice-president of Lehman Brothers, was fired without advanced notice for trying to expose the fraud in his company. It’s what Black refers to as “control fraud”.

 This was all known in the months after the 2008 collapse, yet there hasn’t been a single, solitary executive sent to jail for causing this disaster. So why should anyone be surprised that the fraud on Wall Street has continued to get worse?

When they tried to name the place, some wanted to call it Dawn City or New America or New Phoenix (like mythical bird rising from the ashes.) But the more folks thought about it and realized our circumstances and understood the reason we were huddled here in this remote area protecting ourselves from the elements and marauding bands of sadistic skinheads, was because the world had gone to shit, well, the name might not be what some Madison Avenue type would have called it, but the naming was easy.

Shit Town.

  The news media and the political blogs are enraptured with handicapping the political races. No one has time to worry about real issues anymore. This is the silly season, when immigrant nannies and comments from comedians become “important”. When shady television hucksters are inexplicably taken seriously and hold huge political rallies.

 Yet the real world, the one that operates on tangible things that make an actual difference in our lives, keeps chugging along.

  While all of you were busy obsessing about political trivialities, the governments of the world were entering a global trade war. This development entered a scary stage yesterday when Brazil decided not to attend the coming G20 summit.

 However, that was nothing compared to China’s latest move.

 China, which has been blocking shipments of crucial minerals to Japan for the last month, has now quietly halted shipments of some of those same materials to the United States and Europe, three industry officials said on Tuesday.

  “The embargo is expanding” beyond Japan, said one of the three rare earth industry officials, all of whom insisted on anonymity for fear of business retaliation by Chinese authorities. They said Chinese customs officials imposed the broader shipment restrictions Monday morning, hours after a top Chinese official had summoned international news media Sunday night to denounce United States trade actions.

  China mines 95 percent of the world’s rare earth elements, which have broad commercial and military applications, and are vital to the manufacture of diverse products including large wind turbines and guided missiles. Any curtailment of Chinese supplies of rare earths is likely to be greeted with alarm in Western capitals, particularly because Western companies are believed to keep much smaller stockpiles of rare earths than Japanese companies do.

 American officials had announced on Friday to investigate if China was violating trade laws by subsidizing their clean energy industry. China responded on Sunday with the statement that Washington “cannot win this trade fight.”

 The war of words ended today. The trade war is on.

The U.S. Chamber of Outsourcing

by Dustin Ensinger, EconomyInCrisis.org — Oct 12, 2010

Just last month, the Chamber lobbied vigorously to defeat the Creating American Jobs and End Offshoring Act, which would have given companies a two-year payroll tax holiday, reducing the amount of Social Security taxes they would have to pay, for new employees who replace workers doing similar jobs overseas. The bill would have also ended tax provisions that encourage the outsourcing of jobs.

“Replacing a job that is based in another country with a domestic job does not stimulate economic growth or enhance the competitiveness of American worldwide companies,” Chamber executive vice president Bruce Josten claimed in a letter to senators.

When the $787 billion stimulus bill was passed, the Chamber fought tooth and nail to ensure that a provision requiring that all stimulus projects include only Americans-made products and services was NOT included.

Who’s Looking Out for YOU?

Crossposted at Daily Kos and The Stars Hollow Gazette

Bewitched

Christine O’Donnell has wiggled her nose and put a hex on the GOP establishment.  The novice Tea party candidate turned lots of heads, Linda Blair-like…But Karl Rove, the Warlock of W, has been taken aback by O’Donnell’s victory.  Even he thinks this girl is bat$#!+ crazy and that the Republicans have been given a Tea Party roofie.

Personally, I think she’s the best thing to happen to political satirists since her mentor, Sarah Palin. Republicans, on the other hand, are fingering the Yellow Pages looking for an exorcist. And maybe an antidote.